Tough law to check housing, land deals
Booming but largely unregulated real estate sector. The government is proposing a new law to institute control in the lucrative business in the country. Players will be required to meet strict conditions before they are licensed. PHOTO| FILE
What you need to know:
The government has stepped up its efforts to regulate the real estate sector and protect consumers from ill-services.
Dar es Salaam. A new law is on the cards that could bring to an end the days of unscrupulous estate agents and land brokers.
The government has stepped up its efforts to regulate the real estate sector and protect consumers from ill-services.
In a fresh bid to restore sanity in the sector, the ministry of Lands, Housing and Human Settlements Development has drafted a bill for the establishment of an oversight body.
If passed by Parliament and assented to by the President, the Bill, titled ‘The Estate Agency Act, 2015’, will revolutionise the selling, renting and management of property in the country.
According to the Bill that The Citizen has seen, an oversight body known as the Estate Agency Board is going to be established.
The body will have powers to register and regulate the activities and conduct of estate agents and land brokers. It will also take legal action, including suing unregistered estate agents and land brokers.
The body will also have powers to scale the fees for estate agents.
Currently, middlemen, commonly referred to as dalalis, demand an amount equivalent to one month’s rent from tenants they help look for accommodation.
They also pocket up to 10 per cent of property price if broker the sale of land or house.
The ministry states that one of the reasons for moving the Bill is to formalise land transactions and tackle the rise of “serious land conflicts.”
The object and reason statement of the Bill also notes that most of the activities of estate agents are not regulated by any special law, and in some cases by any law at all.
“This is not a desirable state of affairs in a country where a market for land is a novelty and there is, therefore, a considerable risk that persons unversed in the intricacies of such market, especially poor persons, might be taken advantage of not merely by unscrupulous persons wishing to deal with them, but even by professionals and others,” reads part of the statement.
It adds: “There is already evidence that some persons claiming to be estate agents are behaving in irresponsible and dishonest ways.”
To avoid that, the Bill suggests that for anyone to be licensed as a registered agent by the board, he or she should be a holder of an advanced diploma or degree in the field of estate management.
They must also have practical experience of not less than three years, or holders of any other advanced diploma or degree, who have practiced as provisionally registered agents for not less than three years and successfully passed relevant examinations of the board.
Qualified estate agents who are not Tanzanians but who intend to be employed in Tanzania for a specific assignment and for a specific period would be licensed as temporarily registered agents.
For locals who hold advanced diploma or degree in the field of estate management but haven’t acquired practical experience, they will be entitled to provisional registration.
The same will apply to those holding any other advanced diploma or degree. They will be required to undergo further training in real estate management as shall be described by the board.
For land brokers, the bill suggests two classes, grade I and II.
A person shall be entitled to be registered as Grade I land broker if he/she is a holder of Advanced Certificate of Secondary Education or equivalent with good spoken and written Kiswahili and English.
They also have to pass examinations set by the board.
For registration as Grade II land broker a person has to have practical experience and must register as a land broker at a ward level in his respective area.
When the bill is passed into law and comes to effect, estate agents will have a year to register and two years for land brokers.
After that, any person who operates without registration would be committing an offence and if convicted he/she will be liable for up to five years imprisonment or a fine not exceeding Sh10 million, or both.
The Estate Agency Board will be led by a chairman and not less than four and not more than eight other members appointed by the minister of Lands, Housing and Human Settlements Development.
The chairman is supposed to be a person with expertise, knowledge or long experience in land management in the country.
Other members will be appointed from different institutions (each will provide one). An advocate and member of the Tanganyika Law Society, registered surveyor from Tanzania Institute of Surveyors, an expert in land management from Ardhi University, a member appointed from the Fair Competition Commission, a practicing estate agent, one representative of land brokers, a representative from CSOs working with the poor and one member appointed at the minister’s discretion.
The body will have powers to receive complaints, conduct inquiries and issue disciplinary action in the event that a person is infringing any of its orders will reach to the court for an enforcement order.
